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Fort Worth Landowner Wins Pipeline Lawsuit

June 18th, 2014

A landowner won a $1.6 million pipeline lawsuit against Peregrine Pipeline for the rights to lay pipe across his land. The award reflects an upward trend in the price of transporting fossil fuels across private property. The boom in oil and gas production, largely attributed to the practice of hydraulic fracturing, has led to an increased demand for pipelines. Several other landowners have won cases against pipeline companies, seeking amounts 10 to 20 times higher than the pipeline company’s initial offers.

Pipeline Lawsuits and Easements

Many of the pipeline lawsuits stem from the real estate process known as “easement”. A pipeline operator that would like to law new pipe through private property must pay the landowner an amount, called an easement, to utilize the required piece of property. When the company and the landowner disagree on an amount, the company can obtain the easement through the power of eminent domain. A special commission then calculates the easement amount and, if the parties still disagree, the dispute then goes to court.

Pipeline Lawsuits and Property Values

Most of the pipeline lawsuits regarding easements arise from how each party views the effect the pipeline will have on the property’s value. The increase in the number of pipeline lawsuits stems partially from the increase in land values, especially those properties surrounding urban areas, and partially from increased production from oil companies that need to move their raw materials to refineries. The judgments from these suits also serve to drive up the amounts oil companies are willing to pay in easements in order to avoid more pipeline lawsuits.

Pipeline Lawsuit Awards

In the Fort Worth case, Peregrine Pipeline offered $80,000 to lay a mile-long pipe across a vacant lot. When the landowner took the pipeline lawsuit to court, a Johnson County jury increased the amount to $1.6 million. In 2010, a McMullen County landowner received a $650,000 jury award in a similar case. A Denton County family received an award of $800,000 in 2013 in their pipeline lawsuit. Both cases were upheld on appeal and both awards represented more than 10 times the original offer.

Pipeline Lawsuits and Property Rights

Matthew Festa, a professor at South Texas College of Law in Houston, stated that the growth in pipeline lawsuits represents a clash of traditional Texas values between the oil industry and individual property rights. While Mr. Festa believes that Texans are generally in favor of expanded oil production and the economic boom it brings to the state, he also sees that other factors need to be “taken into account when it comes time to compensate an owner who has to give up some of their property rights for these pipelines.”

Source: Texas Tribune

Know Your Rights in a Pipeline Lawsuit

To find out how we can help you with a pipeline lawsuit, contact us today at 1-855-877-7455. Our friendly staff will ask a few questions about your case and connect you to a pipeline lawsuit attorney. You can also fill out the “Free Case Evaluation” form at the top of this page.

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